The P&L view I'd show a board
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Revenue came in at $500K last month.
Is that good?
I've sat in on dozens of board meetings… and the honest answer to that question is the most annoying one in finance.
It depends.
And honestly… I've given that answer more times than I'd like to admit.
It depends on what you put that number next to.
Put it next to last month, and you might be growing. Put it next to your budget, and you might be way behind.
Same $500K.
Two completely different stories.
There are nine things worth putting a number next to, and I've split them into four groups.
Alright, let's start with the two you probably already run.
Prior period is extra helpful when I'm closing the books.
If an account usually has a balance of $10K, and this month it's $100K…
I know it's something worth calling out and researching further.
Prior year is the one I lean on when a business is seasonal.
Cue the words Black Friday and holiday shopping.
Your busiest month will always look amazing next to the month before.
Compare it to the same month last year, and you'll see whether you actually grew.
Okay, now for my favorite report of all time… budget versus actuals.
If there was only one report I could show the board of directors, it'd be this one.
It shows how much of a grip I have on the business.
You'll always have some variances, so what you need is a story on each and every one.
And then there are scenarios, the budget's more flexible cousin.
Maybe it's a reforecast based on current trends, or any other possibility you want to plan for.
Missed budget a few periods in a row?
It may be time for a reforecast, because you don't want to get caught off guard.
And finally, benchmarks.
That's comparing yourself to another business, ideally in the same industry, to help you understand how you stack up.
This one's the hardest to get, mostly because none of your competitors are emailing you their P&L 😅
Now for the opposite view, where you compare one number to another inside the same month.
Percent of revenue is the classic.
What percentage of your revenue is going to marketing? Or salaries? Or software?
And when your margins are thin, it shows you how much of each sale is left after you subtract out certain costs.
Percent of a section works the same way, but against your total expenses instead of revenue.
So you can see where your biggest spend area lies.
Alright, last group.
Per unit, per customer and per employee take a big number and make it small enough to do something about.
They're a staple in manufacturing, and they come in handy in ecommerce too.
I once worked with an ecommerce company right as they brought on a new director of finance.
And as I was wrapping up my engagement, he built a full forecast just using unit economics.
It was brilliant.
It gave complete clarity into every transaction. Which products had the highest margins, where pricing could increase, and where costs could be reduced.
And once a company gets past about 30 people, you'll want the same P&L split by department.
I had a client who raised a ton of capital and jumped from 10 to 40 employees in a few weeks.
Their old P&L, one page with every expense lumped together, instantly became useless.
They needed to see sales, marketing, R&D and G&A on their own.
So the next time someone asks if a number is good, you can still say it depends… you'll just know exactly what it depends on.
I've devoted my life to finding different ways to work with data and make it scalable and efficient.
So that I, and those around me, can focus on the strategic decisions instead of the mindless, repetitive Excel work.
That's why I built Model Wiz.
It connects to your accounting software and builds five of these for you in Excel: prior period, prior year, budget, percent of revenue and departments.
Want to see it on your own numbers? Book a demo here.
Now I'm curious… which of the nine do you actually look at every month?
Hit reply and let me know. I read every single one.
Josh (Your CFO Guy)
Thanks for reading my article. My goal is to help you grow in your career with proper Finance and Accounting.
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